Does Adding HVAC Increase Home Value?

Potential homebuyers judge the value of a house by how convenient and comfortable living there is, and whether they’ll have to shell out money after purchasing to repair, upgrade, or add necessary electrical appliances. Most homebuyers want to know how efficiently and economically a house can meet its resident’s heating and cooling needs. 

Adding HVAC does increase home value. Notably, homeowners who add modern, energy-efficient HVAC systems or cost-saving heat pumps before selling their homes attract and convert more buyers than those who market their houses with no or old HVAC units.

In this article, I’ll explain whether or not it’s mandatory to replace an existing HVAC before selling your home and how to choose a unit that adds value to your home. I’ll also list the scenarios when repairing or updating a few parts of the HVAC is more feasible and practical than replacing the entire unit and provide proper HVAC maintenance tips for improving existing units.

How Much Does a New HVAC System Increase Home Value?

Adding a new HVAC system can increase home value by about 10%, on average. Considered a basic piece of equipment, an HVAC system doesn’t bring a higher return on investment like a newly-remodeled bathroom. However, a potential home buyer is usually deterred by a malfunctioning or old HVAC system.

Read: What Type Of HVAC System Do I Have?

Do Appraisers Look at HVAC?

Home appraisers don’t look at HVAC components inside the system. They won’t check the furnace, heat pump, air-conditioning unit, ducts, or vents. However, they do check to verify the HVAC system exists and functions as expected.

A non-functioning appliance lessens the value of a house. If you plan to sell your home in the next six months, you have to decide if you want to replace or repair your existing HVAC system.

If you modify your existing HVAC system and install new or repair old ductwork and pipes, appraisers will assess the integrity of the walls and the load-bearing beams. 

Should I Replace HVAC Before Selling My House?

You should replace your HVAC system before selling your house if the unit is more than 20 years old or the cost of repairing it is more than the price of a new unit. You can fix some parts of your HVAC system instead of replacing it entirely, but you must ensure the unit works as expected.

Here’s why you should replace your HVAC before selling your house:

An Outdated Unit Is Less Efficient

An HVAC unit more than 20 years old won’t attract potential buyers. In general, outdated units are considered less energy-efficient and more costly to operate. Today’s best HVAC systems use 30% to 50% less energy than their counterparts made in the mid-1980s. Old units deter environmentally-conscious buyers who prefer appliances that have high ENERGY STAR ratings. 

Even if your system is functioning as expected, potential buyers might be skeptical and believe it’ll malfunction at any moment and add to their expenses. 

The Cost of Repairing the Unit Is More Than the Price of a New System

A rule of thumb for calculating the cost of repairing your existing HVAC unit is to take its age and multiply it by the approximate repair cost. If the number is more than $5,000, replace your unit. 

If your unit is more than 15 years old, you may still have to replace the ductwork before selling your house. Ductworks have a lifespan of about 20-25 years. They, however, start deteriorating after 15 years and reduce your HVAC system’s efficiency. In some houses, replacing ductwork might entail ripping out walls and ceilings that add to the cost of replacement.

Read: What Are The Most Common Type Of HVAC Systems?

Choosing an HVAC System To Add Value to Your Home

If you decide to add an HVAC system or replace your existing one before selling your home, prepare yourself to do some research to find the model that adds the most value to your home without you needing to break the bank. The following are some tips to help you choose an HVAC model:

  • Go in for models with high energy-efficiency ratings. A system with a high energy-efficiency rating brings more cost savings, making it more attractive to potential buyers who want to keep their carbon footprints low. Usually, modern HVAC systems must be 14 SEER (Seasonal Energy Efficiency Ratio). 
  • Choose a size according to the home’s heating and cooling needs. If an HVAC system is too small to meet your home’s heating and cooling needs, it strains to maintain the desired temperature and is made to work harder and longer. Conversely, a unit that’s too large takes up space. A system with a higher tonnage rating wastes energy because it can’t dehumidify as much as an appropriately-sized unit.
  • Smaller models entice potential buyers. After figuring out the right size of HVAC system for your home, search for a compact model. A small HVAC unit won’t take up much space, and it assures potential buyers they’ll still have plenty of room for their belongings.  
  • Consider adding a heat pump. According to data reported by Zillow, the average resale value of a house increases by 7% after adding a heat pump.

If you can, wait till the winter to buy a new HVAC system when retailers offer considerable discounts. Many HVAC repair and installation companies also lower their service charges by as much as 20% during the lean winter months. 

Read: Does HVAC Zoning Really Save Money?

Increasing the Value of Your Home With HVAC Repair and Maintenance

Replacing the entire HVAC system is costly, and not many homeowners can afford the expenses. While the age and condition of your HVAC system influence how your home is assessed, it’s not always necessary to replace the entire unit before selling a house.

Here are a few tips on how you can increase the value of your home without replacing the HVAC:

  • Ensure all components of the HVAC system are properly working. You might want to replace a few parts to make the unit fully functional. 
  • Check supporting but often-overlooked fixtures. This includes the ductwork, pipes, and vents to ensure they’re working as expected.
  • Have any scheduled maintenance done if it’s due before you plan to sell your home. Potential homebuyers want to know that the appliances they’re paying for are well maintained.
  • Upgrade only the heating component of your system. This is only advisable if you live in a region where the winters are frigid and the summers are cool. If they know that they’re not going to use the cooling feature of the HVAC unit, potential homebuyers most likely won’t mind having an outdated cooling component.
  • Add extra features, such as a central dehumidifier, to increase the capabilities of an existing HVAC system. An HVAC system that keeps humidity levels low makes the living quarters more comfortable.
  • Consider adding a cooling component to an existing forced-air heating system instead of investing in an entirely new HVAC system. The cooling component can use the existing ductwork, and you’ll have upgraded your system (and increased your home’s resale value) without incurring the costs of a brand-new HVAC system.
  • Clean the area in and around the utility closet. Grime on the furnace or dust bunnies on the floor give the impression that your HVAC unit has been neglected for some time.

Read: How Much Does It Cost To Move A Furnace And Water Heater?

Conclusion

While adding an HVAC can increase the value of your home, buying and installing a new unit can be expensive. However, you’re going to have to buy a new one if:

  • Your existing unit is more than 20 years old, or
  • The system doesn’t function as it should and the cost of repairing it is more than replacing the entire unit.

However, carefully consider your options. In some cases, it’s possible to get by with repairing or upgrading some HVAC system components to increase the efficiency of the unit and, in turn, increase your home’s resale value.